A time capsule of the greatest financial mania in the history of mankind, told in real-time by regular folks and patriots. May future generations better understand the madness of crowds, and how power and money corrupt.

64 comments:

sk
said...

After condos, I think its going to be precious metals. Individual non professional traders / get rich quick merchants over the last 2 bubbles have moved towards asset classes with more substance - from stocks to realestate - the trend will continue towards precious metals.

Will they go for forex ? There are a lot of sites that offer commission free forex futures trades ( nope I'm not going to provide links ); it doesn't have enough "bottom" IMO and I'm convinced the next cohort to try their luck will believe they learnt the lessons of the class of 2001-2005 - i.e. that set used an asset class that was real, more real than equity but still subject to oversupply.

Which precious metal ? There are arguments for both silver(SLV) and gold(GLD) - I don't think the ETFs will be the main vehicle, it has to be futures of both.Goldbugs will make a fortune and will fail to believe that a mania has also inflated prices and lose some of it after the inevitable correction and a lot more if they don't get out totally in time, people like me who are fundis but like to think they control for the market risk will "buy too late and sell too early" and make steady money - the flippers who just chase the next best thing will again lose it all.

2010 ? Yup, we need two years for real estate to putrefy( burial rites will take a lot longer ) - and 2 years for precious metals to show steady growth, ready for, as the goldbugs will say, the hockey stick spike. We'll need very easy money for that - maybe 2009.

Without easy money, all bets are off. Will the Fed cooperate ? Do bears ( and bulls ) shjt in the woods ?

This WILL be fun. Human beings WILL form crowds and WILL behave like mobs. Its a given.

The next bull market will be in stocks, when the baby boomer's come into their peak retirement saving years. 2008 is the year, some baby boomers who have reached 62 could retire - the odds are that those who can afford to retire then, will not want to, whilst those who would like to, will not be able to afford to.

gold bugs are retards who have not realized that world has changed, and WILL never be allowed to return to some Victorian myth where money is sound, and the poor live in tenement slums.For the vast majority of people, fiat money/welfare is a very good deal and will not be given up without a fight.

There will be a bubble in "Debt Counseling/Bankruptcy Advisors" as all the homedebting sheeple are foreclosed upon.

By the way, I read the entire "Center for Responsible Lending" report that the headlines state will result in 2 million foreclosures.

Sorry to sound even more gloomy than the MSM headlines, but the report states that there are FOURTEEN MILLION Sub-primeFB/Homedebting sheeple out there (not to mention tens of millions of other so-called "good credit" homedebtors), many of whom are in far deeper trouble financially than the report intimates.

My sense is that we will see AT LEAST five million homes dumped back on the market as these sheeple go down in flames and perhaps as many a ten million.

I cannot begin to tell you what this massive debt default will do to the $6 trillion MBS market, the $3 trillion in real estate loans the banks are sitting on or the ripples through the derivatives casino.

I shudder to think about it.

In any event, I fully expect the next boom to be in credit counselors--many of them FBs themselves just scrounging for THEIR next meal..

I've owned PM's for decades. The next boom/bust could be anything at this point. I tend to think the tidal wave of liquidity will move to stocks and then to PM's. The move to PM's won't be until the stocks stagnate or drop. Once gold breaks $850 it could run to $2000. I'm selling 1/2 at $1500 and keeping the rest. My cost bases is very low. I like to own gold.

What will the next big speculative run up be in? I think we are already looking at peak gold and we are not far off from peak stocks. I think the next big speculative fervor will be in selling all things short.

At some time point in the future all virtual money (about 500 TRILLIOIN $$$) will try to materialize on Earth. Hyperinflation and rationing are our future for a wile, until new currency will be installed.

But that time is not for gold yet. If you posess little silver and gold coins you'll use it for BASIC NEEDS like FOOD and Transportation. If you posess alot, you'll use it after SHTF.

Why after? Because "good" new money will be scarse as well as physical gold and silver. You'll just need to wait long enough....

Yeah, retiring boomers will buy more stocks as their income falls because they're no longer employed. Ever heard of having to sell retirement plan assets to pay the bills? Or do you think that retirees are getting rich of social security?

Those 'gold bug' retards who bought in the $200's and $300's have made a lot more than your beloved stock market did from 2001-2006.

Anonymous said... Yeah, retiring boomers will buy more stocks as their income falls because they're no longer employed. Ever heard of having to sell retirement plan assets to pay the bills? Or do you think that retirees are getting rich of social security?-----------

Toilet paper. With a little bit of collusion on the part of the toilet paper manufacturers and the Toilet Paper Industrial Complex (TPIC), they can create a short supply of this precious commodity. Once panic sets in, we'll be paying $5-$7/roll on the open market. I'm stocking up at Costco right now.... I'm going to make a killing on this one. :-)

The next bull market will be in stocks, when the baby boomer's come into their peak retirement saving years.

Huh? The peak saving years have passed. The boomers are going to start cashing in their stocks in a few years. That plus the savings rate is already negative makes stocks look like a very bad investment at this time

730 was a precursor. Before gold went to $850/oz it jumped up, then returned back, sat for a while and then shoot up to $850. Rubin stabilized inflation by drastical actions. Study the history, guys.

In a panic mode, when all virtual money will chase real assets two scenarios are possible.

First is hyperinflation (all internal and external debt is paid by printed money, feeding hyperinflation. The second is introducing a new currency ("amero" or so) and setting some rules for exchage old US$ to new currency. Then some laws against "bad or criminal" money will be introduced. That will lead to rationing. I personally went through both scenarios, it's not fun guys.

I don't see these guys getting out of real estate. The benefits of finding a sucker to invest in their schemes are to high. They will most likely try to continue there scheme flipping properties. If they buy a property, hire a builder to do some cosmetic construction they can fool buyers who do not understand major construction vs. minor repairs.

In a few years when I purchase a home for a reasonable price I will go to county records myslelf and get information on when the property was purchased, how much was it purchased for, what is the debt on the property and what specifically were the improvements.

I will be very skeptical of any home with what appears to be "major improvements".

I will also very carefully pick my lender and very thoroughtly understand the loan terms.

Whatever the hell you think it is ,just be sure to sell,sell, sell before the top.Never a bad time to take a profit you know.Gold has it's days,homes have their days,cars have their days,stocks have their days.One thing I really love about gold ,and silver is how easily they can be hidden from "big Brother".401ks ,on the other hand will be taxed,penalized,golden parachuted,fee'd,stolen,locked-up,valued in a deteriorating currency,and if you ar lucky will be worth enouph when you want to retire to actually do so for a few years.Then you gotta go back to work.Never forget to sell,and then remember to convert your deteriorating dollars into something moving up in value against other assets ,and currencies.Keep it moving in your own little shell game so the tax man will prey on easier targets.

I was approached to author "Foreign Exchange for Dummies" about a year ago, so the publishers are seeing interest rising there (mind you, I said no because as an ex-forex dealer in the professional market, I saw experts who could never win predictably - I didn't want to be part of having individual suckers lose their shirts).

That's an area where whipsaws take out even experience intraday institutional traders nevermind the average Joe. For now, there are these megatrend dollar sell offs and rallies where the average newbie gains some confidence but it never lasts.

"Yeah, keep buying gold, Einstein. That strategy will pay off when society crumbles in a few years and we're all living in caves in the mountains."

LOL. What passes for 'rational thought' these days is indeed humorous. If it ever gets this bad who's going to buy your stock certificates if your home is a mountain cave? Oh yeah, that's right, you won't even have paper stock certificates to trade. Guess you'll have to hope that Etrade or whatever you use will ship them to your mountain cave. Might be kinda hard of society gets set back to the Stone Age. Better hope your own 'mountain cave scenario' never happens.

Properties that lenders acquire through foreclosure are known as REO, short for real-estate owned.

Metro Denver has the largest concentration of third-party REO property managers of any city, a legacy of a real estate downturn - and a wave of foreclosures - that accompanied the oil bust of the late 1980s.

The current foreclosure epidemic traces more to overbuilding and aggressive lending than to fundamental economic problems, but the industry spawned by the earlier deluge of defaults is coming on strong.

Don't expect economic development officials to promote the fact, but REO property management is one of metro Denver's hottest growth industries.

"We are hiring like crazy. We expect to get busier in 2007," said David McCarthy, president and chief executive of Integrated Asset Services, one of the country's largest independent REO property managers.

The firm of 116 workers has hired 42 people this year and plans to add another 30 in the first quarter of 2007. The number of foreclosed homes it has sold has jumped from about 3,000 last year to 4,000 this year.

Actually, any tangible asset is a better investment than holding your dollars that are falling in value. The U.S. government will continue to borrow and devalue the dollar until someone important (a country) steps up and says "no more". Bush will destroy the dollar (create dollars out of thin air by borrowing from thin air) if that's what it takes to keep money flowing to the military.

The people who will most benefit from this inflation are the bankers who can "sell" money (make loans) and quickly invest their profits into something of value besides dollars. Notice how the big bankers are investing in "China" big time. Uh oh.

Gold just happens to be a commodity where you can carry a lot of value easily. If land weren't so inflated, I'd be investing in that. Since silver has both monetary and industrial uses, that's where I'm putting half my savings.

::there are these megatrend dollar sell offs and rallies where the average newbie gains some confidence but it never lasts

All true, however, those who're good at it (perhaps 5% of anyone who tries), can make 6 to 7 figure salaries w/o a problem. The liquidity of forex is in the trillions per day which is considerably higher than the what the NASDAQ daytraders of the 90s had to work with. The problem is that these stupid Kiyosaki-like infomercials like 4X made easy, etc, sell lame software which generates buy/sell signals which quickly parts fools from their money.

"Speculation is a round game; the players see little or nothing of their cards at first starting; gains may be great - and so may losses. The run of luck went against Mr. Nickelby. A mania prevailed, a bubble burst, four stockbrokers took villa residences at Florence, four hundred nobodies were ruined, and among them Mr. Nicleby."

Instead of gold, even if you sank it all into the NASDAQ Composite Index, and even with the horrible 1999 crash, you have done better!

Gold:1970: $ 352006: $620growth = 1671%

NASDAQ:Feb 5 1971: $ 100.00Dec 26 2006: $2,413.51growth = 2314%

Yeah, keep buying gold, Einstein. That strategy will pay off when society crumbles in a few years and we're all living in caves in the mountains.

Wednesday, December 27, 2006 1:43:49 AM

Three kinds of lies: Lies, damned lies, and statistics.

Go back 8 months and gold was ahead of the NASDAQ. So at the very least, they're keeping up with each other. But go back to the 70s and from 1970 to 1980 gold WAY outperformed the NASDAQ. That's just for starters. THe nasdaq is just a composite, and the members get changed often. You would have needed to be in an index fund that anally followed the nasdaq index. If you traded on your own, you would have most likely gotten scorched. But seeing as how now in 2006 is a lot like 1970 as far as fundamentals goes, if you stay in the nasdaq as opposed to buying gold, you're going to get your ass handed to you.

Silver is more commodity-like, during bearish selloffs and PM-like, during fears of inflation, war, etc. That's why silver has sharp sell offs in congruence with zinc and the rest, including more expensive metals like platinum, whereas Gold is more stable in the sense that it honors its 200+ day EMA, instead of treading into serious oversold territories like with other metals.

If anything, it's better to split one's holding into both gold and silver positions but to trade silver more actively since commodities tend to be oversold more often than not which then results in great buying opportunities during the troughs.

No wonder you golddopes think gold is a good investment, you can't even do rudimentary math!

Gold:1970: $ 35Apr 2006 PEAK: $730growth = 1986%

NASDAQ:Feb 5 1971: $ 100.00Apr 27 2006: $2,344.95growth = 2245%

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Nice job of latching onto one little point in time. Trace the whole thing and you'll see they're just about even. While you're at it, address the other points I made and see if gold isn't a better value.

Nice job of latching onto one little point in time. Trace the whole thing and you'll see they're just about even. While you're at it, address the other points I made and see if gold isn't a better value.

"One little point in time?" You gotta be kidding me. Try to follow the road map, Magellan:

First, GoldDope #1 claimed that gold was a good investment as long as you held it long enough, so I posted Gold v. NASDAQ composite from 1970 to present.

NASDAQ composite outperformed gold.

So, then, GoldDope #2 claimed that 8 months ago, Gold had NASDAQ beat, so I went back to the PEAK - THE PEAK!! - for Gold and NASDAQ compsite *still* beat Gold.

Now, you, GoldDope #3 are telling me that I cherry-picked a point in time?

I see that I've wandered into the below-50-IQ chat room... so excuse me while I beat a hasty retreat.

Carry on, GoldDopes! Remmeber, buy now, because God isn't making any more gold!!

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